Buying a cup of coffee with a dollar bill represents the use of money as a:
A. medium of exchange.
B. unit of account.
C. store of value.
D. commodity.
Answer: A
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Suppose the actual and expected price levels in an economy are initially equal. However, the actual price level falls eventually due to a change in economic conditions. Which of the following will occur over the long run?
a. The economy will move rightward along the short-run aggregate supply curve. b. The economy will move leftward along the short-run aggregate supply curve. c. The short-run aggregate supply curve will shift to the right. d. The short-run aggregate supply curve will shift to the left. e. The short-run aggregate supply curve will become flatter.
An increase in price will result in an increase in supply.
a. true b. false
A permanent tax cut would likely ________ consumption spending ________ than would a tax rebate like the one issued in 2008
A) increase; more B) increase; less C) decrease; more D) decrease; less
National income is equal to ________.
A. rent + transfer payments + interest + wages B. gross investment - depreciation + indirect business taxes - net foreign income C. wages + rent + interest + profits and losses D. net investment + depreciation + net exports + net foreign income